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Into an analytical stock-flow consistent postkaleckian distribution and growth model the following transmission channels of ‘financialisaton’ are integrated. i. ‘Financialisation’ is assumed to affect distribution between firms and rentiers in the short run, and distribution between capital and labour through a dividend-elastic mark-up in firms’ price setting in the medium run. ii. Firms’ investment is affected through a ‘management’s preference channel’ and an ‘internal means of finance channel’. iii. Consumption is influenced via distribution of dividends in the short run and via a reduction in the labour income share in the medium run. In the model the total effect of ‘financialisation’ is derived, the development of firms’ outside finance-capital ratio is endogenised, and the medium-run stability and viability of the financial structure and of capital accumulation is checked.
Eckhard Hein (Tue,) studied this question.